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Specialty chemicals firm Lanxess has signed a definitive agreement to acquire US-based Chemtura Corporation, a provider of flame-retardant and lubricant additives.

With this acquisition, Lanxess intends to build on its additives portfolio.

Under the agreement, Chemtura shareholders will receive $33.50 per share in cash for each outstanding share of common stock held, which represents an 18.9% premium to the stock’s closing share price of $28.18 on 23 September.

Carrying an enterprise value of approximately €2.4bn, the deal will be financed by Lanxess primarily through senior and hybrid bonds, as well as from existing liquidity.

"Through the acquisition, we are further implementing our strategy to become a more resilient and profitable chemical company."

Lanxess board of management chairman Matthias Zachert said: “With this acquisition, we are forming a champion in the field of additives and are strengthening our already profitable portfolio.

“Through the acquisition, we are further implementing our strategy to become a more resilient and profitable chemical company. We are significantly building on our competitive positioning in medium-sized markets and increasing our presence in North America. Lanxess is taking a next and major step forward on its growth path.”

Chemtura board chairman, president and CEO Craig A Rogerson said: “The transaction provides premium value to our shareholders and benefits our customers and employees by making Chemtura part of a much larger, stronger global enterprise with the resources to fully support a more diverse suite of specialty chemicals products and services."

The transaction is expected to close around mid-2017 and is subject to approval by Chemtura shareholders, regulatory approvals and other customary closing conditions.

For Lanxess, the deal will be accretive to earnings per share (EPS) in the first fiscal year, with annual synergies of approximately €100m expected by 2020.

Chemtura has two additive segments, which along with Lanxess's Rhein Chemie Additives business unit (ADD) will form the new performance additives segment after completion of the deal.